Forced Arbitration Robs Workers of Billions in Wages
This is the second of two posts on wage theft and how it hurts workers, families, and communities. You can read the first post here.
Corporations’ widespread use — and abuse — of forced arbitration in employment contracts allow them to steal billions of dollars from workers every year with impunity. Employers have unilaterally imposed mandatory arbitration agreements onto 60 million American workers, and the practice is only becoming more widespread. By 2024, 80 percent of nonunion workers will be subject to forced arbitration.
Those same employers cheat their workers out of billions by paying lower than the minimum wage, denying workers overtime wage rates, coercing employees to work “off the clock” before or after shifts, denying workers legally mandated breaks, confiscating tips, and more. Corporations rob workers of an estimated $15 billion per year through minimum wage violations alone, but the real extent of wage theft is likely even higher because wage violations are almost entirely unreported.
The surging costs of housing, transportation, utilities, and food exacerbate the burden of wage theft on workers and their families. Americans deserve a full and impartial opportunity to recover stolen wages, and current legislation sitting in the U.S. Senate must be part of …
The National Labor Relations Act (NLRA) leaves no doubt about its purpose. Enacted in 1935, it was set against a backdrop of decades of intense and often violent labor strife. Recall the massacre of striking coal miners at Ludlow, Colorado (1914); the bloody Battle of Blair Mountain in West Virginia (1921), which pit miners against the militia; and the West Coast Longshoremen’s Strike (1934) over union representation, which revealed organized workers’ enormous power over the nation’s economy.
The NLRA was designed to minimize strife by requiring employers to recognize employees’ efforts to engage in “mutual aid and protection”; adjudicating conflict so as to avoid direct action; and, to quote from the act itself, by “encouraging practices fundamental to the friendly adjustment of industrial disputes … and by restoring equality of bargaining power between employers and employees.”
Employers, naturally, prefer to deal with their workers one on …
This op-ed was originally published by The Hill.
Recently, Congress passed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act, which will block enforcement of arbitration requirements for workers alleging sexual harassment or assault. Arbitration is the process of handling disputes outside of the court system — forced arbitration prohibits workers from suing their employer altogether.
This is an important outcome for the #MeToo movement and has the potential to reach many workers and employment claims, depending on how broadly or narrowly it is interpreted.
In a fair and just country, corporations are held accountable in the courts if their irresponsible behavior harms people. However, like many policies, the communities most impacted by forced arbitration are historically marginalized groups. Indeed, forced arbitration has a disproportionate impact on low-income Americans and Black and brown women when they are the victims of discrimination. Their abuse goes beyond the …
UPDATE: On March 17, the House passed the FAIR Act (H.R. 963), sending it to the Senate for consideration. Read my brief statement urging the Senate to quickly pass this crucial bill.
UPDATE: On February 10, the Senate passed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (H.R. 4445), sending it to President Joe Biden for his signature. Read my brief statement on the importance of this legislation.
A few years ago, Roschelle Powers took a routine trip to visit her mom, Roberta, at her nursing home in Birmingham, Alabama. When Roschelle opened the door, she found her mother vomiting, disoriented — and clutching a handful of pills. Roberta’s son, Larry, visited a few days later and found his mom alone and unresponsive. She died soon after – with 20 times the recommended dose of her diabetes medication in her blood.
The Powerses …
In February, Georgia Rep. Hank Johnson, chair of the House Judiciary Subcommittee on Courts, Intellectual Property, and the Internet, reintroduced the FAIR Act. The legislation would protect workers and consumers by eliminating restrictive "forced arbitration" clauses in employment and consumer contracts. The bill would also allow consumers and workers to agree to arbitration after a dispute occurs if doing so is in their best interests. A companion measure has been introduced in the Senate.
Arbitration — a process where third parties resolve legal disputes out of court — is a standard precondition to most, if not all, nonunion employment and consumer contracts. It's considered "forced" because few consumers and workers are aware that they are agreeing to mandatory arbitration when they sign contracts. In most contracts, arbitration is imposed on a take-it-or-leave-it basis before any dispute even occurs; refusing to sign is rarely a realistic option because other sellers …
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